Tyler Cowen: Who’s the GOAT of economics?

Well, thank you everyone for joining us today. Our guest needs no introduction, but I'm going to introduce him anyway. We're very lucky to be joined today by Tyler Cowen, who is the Holbert L. Harris Chair of Economics at George Mason University. He's the faculty director of the Mercatus Center and the force behind the insightful and always delightful Marginal Revolution blog and Conversations with Tyler. And today we're going to be talking about his wonderful and experimental new AI book, G.O.A.T., who is the greatest economist of all time and why does it matter. And Tyler, thank you so much for joining us today.

Thank you for the introduction. Very happy to be here. Anna tells me this is my third Interintellect, which makes me one of the leaders.

Yes. So in terms of structure today, we're going to discuss the book and why Tyler wrote it, the G.O.A.T. framework and the contenders. We'll talk about how economics has evolved as a discipline, the future of books and learning. And we'll try to all have like a dialogue and conversation around it because the goal of these salons is to promote that. This isn't just an interview or Tyler giving us a speech. So with that, we'll kick things off by talking about the book itself. So you've undertaken this really ambitious project, Tyler. You're combining the history of economic thought, the people who shaped it, because you can't divorce the discipline from it. And you're also trying to see economics as a vehicle for carrying ideas about the world. So why was it important for you to write this book now?

Well, I didn't write the book now. This was a project conceived out of sheer desperation. So most of it I wrote at the height of the pandemic. Libraries were closed. I couldn't really travel much. I couldn't easily go meet with people. I also felt I couldn't write a book about the world to come, which is what some of my other books are. Because I had no idea how things were going to go. So I just sat down and thought, like, what's the actual possible book I can write so I don't go crazy, stir crazy, being locked up in my home? And well, these are books of the great economists. I owned them already. I could access online. It wasn't the only possible book I could write at that time. And I really got quite excited once I started doing it. And it was a way of rediscovering my own roots, you know, learning economics. So it felt like reliving part of my earlier life. And I'm very glad I was forced to pick this topic that otherwise I never would have done because it's not really a commercially viable book, I think.

And one of the things that you mentioned as your motivation was that you wanted to see economics as a vehicle for carrying ideas about the world. And this is not what the discipline necessarily focuses On Today, and you mentioned that perhaps the decline is inevitable. So why is it important to remember it that way, and what do you hope that readers will gain from this perspective?

Well, in economics today, the rewards go to people who can do something like write a 90-page research paper where really all of it is substance. Most of it is statistical testing. You do every possible robustness check, anything you can possibly do with your data, you do it, and you have multiple appendices which could be 50 or 60 of those 90 pages, and that's fine. It gives you better quality research. But the kind of economics we found in Adam Smith or John Maynard Keynes, where it's about having ideas about the world, how the world works, the world as a whole, it seems to me we've lost that, and I wanted to revive that tradition. My own work has always been in more of that older tradition. And I just thought, well, let's go back and see what those people had done. And what amazed me most of all is just how very, very smart all of them were, each and every one. And that's why they're contenders for GOAT, greatest of all time.

So as you reread some of these economists and came up with your framework for evaluating them, Did you find that you were surprised? Did any of your perspectives and values change?

Well, every day I was surprised. So Malthus was a much deeper thinker than I had realized. I used to think of him as someone who was very pessimistic and had some crude hypotheses about population growth, which obviously were refuted the moment after he wrote them by the Industrial Revolution. And that's just not what he says at all. So he's a much deeper thinker. He's still relevant for today. I did a whole Interintellect once on Malthus, and I didn't tell you all at the time, but I was like practicing that chapter for the book. I wanted this book to be a surprise. John Stuart Mill, Keynes, they're just all, you know, when you read through their work as a whole, remarkably deep above all else.

And you wrote this book from the perspective of a fan, and it's a deeply personal book. So why did you decide to write it that way? And were you surprised by any of the reception you've, you've gotten regarding how you wrote the book?

In most books about historical economists, they're written from a more scholarly point of view. Now, my book is scholarly in the sense that it's based on a lot of reading. It has hundreds of footnotes, but the tone of the book, it's like you're reading a sports book about your favorite basketball players or movie stars. And I just thought to myself, honestly, like Tyler Cowen, what kind of books do you like to read? And I thought, I like to read books written by fans. So I'm a fan. I am actually a fan of all these people. Why shouldn't I just do that? And then I'm here locked up in my house again, pandemic, and it's like, well, this has to be fun for me. So I just thought it was a way to make the book different. And I think people have responded to it quite positively. They're tired of the other.

Yeah, I felt that way too, as I was reading your book. I know you mentioned that one of your goals was to teach people economics and to get them interested in it. And the fact that you describe your, or you write about it from the perspective of a fan and you share your opinions, it's a lot more engaging. That way because, um, as a reader I can be like, okay, I'm curious about why you came to that conclusion, or I feel like I have to do some secondary research on this, whereas if it's just more linear or pedagogical, you might not have that same response to a piece of writing.

Yeah, and in general, uh, we're all more used to reading social media, right, which a lot of it is quite emotional, so we respond to that more, maybe sometimes in, in bad ways, And that shows through also. So I think it's the style in a way is quite contemporary.

Yes. So I wanted to go from here to like your framework for coming up with what you think is a great economist, or at least a contender for like the greatest economists of all time. So you know that one needs to have breadth and depth, not be too wrong, to be of historical import and have done micro and macro. Theory and some form of empirical work as well. So how did you come up with that criteria? And were you influenced at all by others who have tried to figure out what makes a good economist? For example, Keynes had, had his own criteria.

Well, I think it was a pretty arbitrary list. I wrote most of the book before coming up with the list. And then someone said to me, well, you need to like spell out the standard more. It's like, like, clearly that's correct. And I just thought, well, what is it I care about? And that was the list. I think it's quite unscientific. It's part of the subjective side of the book. But when you hear the list, it doesn't sound crazy, right? Like they should have something to do with the real world. Like they can't have been totally wrong about everything. So I think the list has held up pretty well. Some people have said, like Greg Ransom said on Twitter, what really matters is just how revolutionary is their best idea and not the rest. And he wanted to pick Hayek on that basis. I mean, that's a fair perspective. Uh, I just thought with a longer list I'd get a more interesting book.

Mm-hmm. Were there any criteria that you ended up leaving out, or when you Tried to come up with that framework after coming up with your list of great economists where you were like, that, that's not as important as I thought it was.

Well, one thing I discuss a little, but I basically left out is, you know, did you have students? Did you work with other people? Now, most on this list, in fact, did that. So I'm not sure it would have changed how it all panned out. But it's not formally on the list, and arguably it's very important. What kind of mentor or friend were they? Now, Adam Smith was the best friend of David Hume, and I believe Hume would have been much worse without the support of Smith and vice versa. So that's to Smith's credit. I do mention it. In the real world, we judge people by that to a great extent, right? Historically, I'm not sure it matters as much.

So one of the things that you mentioned is that one has to be of historical import. What do you mean by that? Is it to be fundamental, original? Is it to have influence on policy? Can you unpack that a bit?

If we take, for instance, John Maynard Keynes, he clearly influenced the policy response to the Great Depression, more fiscal policy. He directly helped design the Bretton Woods monetary system after World War II. He had an influence over how the Treaty of Versailles was perceived. He had a hand in the currency system for India. That's 4 big things right there. Whether or not you agree with it all, he clearly was of historical importance. So there's other economists of whom I think very, very highly. Kenneth Arrow would be one example. I don't think he had a comparable role in the real world, even though as a theorist, I think he was clearly smarter and better than Keynes. So Arrow is not a contender for GOAT for me in the way that Keynes was. Hayek had to do with the fall of communism, among other issues, and so on. So I think you need that to really be in the running. You have to have mattered.

And given that the discipline has evolved so much over time, you have this list of criteria and different things will be more relevant or more important for evaluating people in their time. So what do you— how do you think of people when you— as being economists? Like, what is an economist to you versus, say, a social thinker, a social theorist, or a thinker in the social sciences space? For example, you say a lot of Schumpeter's contributions weren't really in the realm of economics.

You know, the book raises that question quite directly, and I think I end up siding with the view it's social theory that matters. So my affection for John Stuart Mill, as a technical economist, he's not top 5, but as a thinker about all of society, women's issues, voting systems, slavery, and philosophy, romanticism, poetry, much more. He's clearly the best of the lot. So where do you end up on Mill? I end up in a quite positive direction because I'm elevating the broadest possible vision of economics. But I don't think there's a factual answer to your question. Uh, maybe that's just my preference.

We'll, we'll go more in depth into each of the economists in your shortlist and the ones that didn't make it in the Salon. But I also wanted to pause for any questions or comments from, from all of our participants. Dominic, you have your hand up.

I think Anna's went up just before mine.

I have an aside, so please take it and I will go after you.

Okay. Yes, so I wanted to ask where you think Elinor Ostrom would fit on your criteria, as I feel that her work on the theory of the commons is extremely relevant in the modern day with the growth of importance of commons like open source software becoming an increasingly important part of the infrastructure for our society. So I'd be interested to hear your thoughts on her. Well, I have a very high opinion of Elinor Ostrom. She used to visit Mercatus every year. So you could say, like, I spent our own money on her. That's a kind of demonstrated preference. She definitely deserved a Nobel Prize, and on the issue of the commons, she's clearly the number one thinker. But in terms of being greatest economist, even of her generation, I don't quite think she's in the running. She was too specialized, admittedly on a very important issue, as you probably know, not formally an economist at all, a very important thinker, on how small groups set norms to solve local problems, uh, but didn't do macro, didn't do most fields of economics, uh, but someone I admired greatly. And she also was a very, very nice person, and as a mentor and worker with others, she was A++. If that at least addresses your question.

Anna, you had a question or comment.

Thank you. Yeah, I was just really curious whether, Tyler, do you feel that there is an economist who's a great economist despite not having— is there an exception to your rule that a great economist has to have a direct effect, at least eventually, on the outcome of real-world societies?

You can be a great economist without any effect and most have had no effect. But I don't think you can be the greatest of all time, is the way I would put it. But even if you look at top-tier economists, I would say 90% or more really have had no effect. I think it's true in most fields. Not any criticism intended of them, just the world is a huge place and it's hard, you know, to nudge it no matter who you are or what you're doing. So it's true for economists as well.. But the very finalists, they all had big and noticeable effects, I would say, on net positive. But again, opinions there are going to differ.

Thank you. Isabella.

Yeah, so I've been playing with the— playing with the book a little bit, and I really appreciate the new experience it gives me in terms of thinking about these thinkers and their contribution. And I'm wondering I've got 1,000 process questions. So if you want to punt this to later, by the way, if this may not be a content enough question, you can let me know. But I'm basically wondering whether you played a little bit or experimented with what the great— not only the criteria of what would make the greatest, but even the idea of how the structure of the book changes and how you interact with it as you play along with trying to find one greatest person. Because what I found was a sort of really important process of thinking that found me layering parts of this person and parts of that person. And there was this kind of collage that happened for me. And I thought, well, the greatest one is if I can get so-and-so's ideas about this and the way he actually came to educate the public about this and so on. So I'm just basically wondering whether there was any consideration for you about making the process not about, hey reader, find the goat, and more another question. And if not, if you thought about how that might have restructured the book.

Or the book— I thought about that a good deal. I wanted the book to come off that it's a kind of quest. And it's like a quest for buying used books or other things. There is no final answer. And if you come away from the book a little confused about who is really Go, that's what I want. And if you, you know, have the book fed into GPT, as is done, and you keep on asking GPT, Who does Tyler think is GOAT? It gives you a different answer each time. It's not a drawback of GPT, it's GPT being wise. So I say in the last chapter, well, my personal favorite is Mill. I don't think it's defensible as he's clearly GOAT. It's not. The most defensible pick is Adam Smith, just because he was the first. But that's a little too simple. There wouldn't be a book, there wouldn't be as much of a quest. So it's open-ended, and I think you can cycle around indefinitely. Well, maybe it's Keynes, maybe it's Milton Friedman, and so on. And that's on purpose.

Thanks.

I think of part of my mission in life with many of my projects, it's to try to teach myself and other people how to appreciate things, people. So my podcast, it's all about like, how can you learn, or how am I trying to learn how to appreciate these guests? And if it's this never-ending thing, it's much more instructive than if it's like, oh, well, the best is clearly, you know, whichever name.

So just, just to follow up really quickly, I gave it to my two sons who are almost 18 years old. They're in 12th grade. And I just wanted to see what their kind of raw experience of it was. And of course, because they're inundated with the most boring way of memorizing philosophers and, you know, the two-line summary in their school, and they go to a reasonable school and so on. They got confused very early on. I'm like, yes, so that's the point. Now keep going because you guys are using ChatGPT. Keep going and see where that confusion takes you. And I just, I was amazed by how much energy had to go into me encouraging them that there isn't one right answer. And I think that's one of the actual nuggets of the experience of interacting with that book. So I'm really glad to hear you sort of explicitly say it this way.

And I think much more of our education system should be like this. And you look at areas that people learn on their own. Again, I keep coming back to sports as an example, or maybe popular music. People talk about them like fans, but children, even very young children, they can learn sports, sports statistics remarkably well. The way I learned a lot of the math in my life was not in school. It was by having baseball cards. And trying to figure out like what a batting average meant. And when I was 7, 8 years old, like I understood expected value. Well, that was slugging percentage and many other things that maybe I wouldn't have learned until 6th or 7th grade or later. And I learned them as a fan. So I hope we can do more of this.

Madhu, you had a question.

Hi.

Yeah, I was just wondering from the A follow-up from the first question.

Do you have something to say about not specializing in a particular field in econ, like, in order to, like, I guess, secure the title of greatest economist of all time? Well, the people who are my finalists, none of them specialize. They all tried to bite off more than they could chew. I would say that's a good thing.. But it's a controversial thing, and it's become harder and harder as fields of knowledge have grown and multiplied. Like Adam Smith, he really had read close to all of the economics of his time, and no one can say that today, or even 1,000th of it. So it's getting much harder to be a generalist in some ways. In other ways, it's easier. You have the internet, you have AI, you can track down and aggregate information. You don't have to understand everything, but you can easily ask someone who does. So there's a few ways in which being a generalist is easier, and trying to teach those to people, that's also part of what I try to do.

So do you think it's easier to be a generalist and influential perhaps outside of formal disciplines now? And do you think the great thinkers will emerge outside of traditional institutions in the future?

I think a lot of them will be partly outside of traditional institutions and partly inside, not completely inside the way most academics are, but I don't think they'll have no affiliations. They'll be like weird intermediate cases that are not easily described or characterized and floating amongst a number of quite different worlds. That's what I think. If you're only an academic, it's increasingly hard to be creative. But I think also if all you do is run your company, you might do a great job, but it will be very hard to be creative. If you look at a Patrick Collison, who's extremely creative, well, he is CEO of Stripe, but he writes things, studies things, puts on conferences, does a number of other activities. So he's floating across these different worlds.

Better. Tyler, what do you think makes a person interested in how the world works? We're talking about people who are triggered by a tiny angle insight into knowledge, whether that's baseball cards or the agriculture in the neighboring villages in rural England. And from that, they start scratching at the wallpaper until bigger problems emerge. Do you think that that's an innate drive, or is this something where we could make a great difference in converting more people to this, this curiosity?

I think the temperament is innate, genetic, 70 to 80%. But that said, you need the opportunity. And if you grow up in a remote village, you know, in Kenya, and you're not exposed to any of this, well, you can't be it. But if someone exposes you to it, you can pull a lot of people in because it's a big world with billions of people. But I don't think the inclination can so much be taught, I'm sorry to say.

I remember reading in one of Richard Dawkins's books about their, that generation's biology professor in Oxford. And this was the time when academics weren't so pressured to publish. It was not this kind of race, horse race. And he describes his professor as just somebody whose job is to get people interested and excited about the discipline. And it's kind of an aside in the book, and I will just forever remember observing people in Interims like doing this for each other.

And that's my number one job too as teacher. It's not conveying information, which is all over the place. It's somehow embodying a something whether it's his teacher, mentor. And you hope that just by being that in some visible way, that something about it is infectious. And this, I think, is related to the mission of Interintellect as well. It's like you're all doing this for each other.

So let's segue a bit into like a deeper discussion of the GOAT contenders themselves and the ones who didn't make the list. So Tyler, you start the book with Friedman, and you note that he's often perceived as a controversial figure. Why do you think that is? Do you think he's misunderstood, misread? What can we learn from Milton Friedman?

There's a lot of misinformation about some of the people in this book. And I think Friedman is the number one victim of that. So many people have this sense that, oh, he went to Chile, he worked with Pinochet. He was somehow responsible for what that regime did. But it's just not true. There's a fair amount of propaganda out there. People who don't like Friedman or his ideas, they've pushed this myth. And if you look into it, and I even did things like read Chilean Spanish-language newspapers about Friedman's visit, you know, he came, he was there briefly, he gave some talks, he left. I think he, because he was Friedman and persuasive, he had some influence in actually a non-autocratic direction. He said quite clearly, I believe in democracy. Uh, but somehow this myth has caught on that he's connected to the Pinochet regime. Now, other people like Hayek, he gets off easy, but the latter part of his life, it seems he turned pretty nasty, and that's not so widely known. I don't think we should discriminate against his best ideas for that reason.. But you look at all of these individuals. Keynes was president of the Eugenics Society for 7 or 8 years. That's hardly ever mentioned. Again, don't judge his ideas by that, but all these people have very interesting histories and I wanted to uncover them. So I would say Friedman is the one, Friedman and John Stuart Mill, their records are really pretty unblemished. You may not agree with them. But sort of morally, they were on the right sides of things. Adam Smith too.

And you note that among Friedman's many contributions, his theory of the permanent— his theory of permanent income is his most significant. Why did you pick that, even though he's more well known for a lot of his more popular work?

Well, first of all, it's correct. Second, a lot of the more popular work I think is not correct. Or at least it's unproven. And Friedman on the permanent income hypothesis— for those of you who don't know, before Friedman, the view was it's your income today that determines how much you will spend. And Friedman says, no, it's the expectation of all your future incomes, what you think will be your permanent income. That maybe sounds simple, but at the time it was a shock to people and it was not accepted right away. It's turned out to have birthed multiple literatures and thousands of research papers. And it's held up pretty well. It's been fruitful and generative, and it was the key turning point in Milton's career. So I think it's a pretty common view that's his best academic contribution. And even people who don't agree with his politics pretty much admit he got that one right.

So what would you say are How would you say Milton Friedman's legacy as a whole has held up? Has he been applied correctly? Has he been misapplied? Has he been forgotten over time?

He's being somewhat forgotten. So I think sometimes it's called neoliberalism. I don't like that word. I would call it classical liberalism. But with the rise of populism on the right and the left, that is going out of favor. So Friedman, in my view, is losing ground. Still highly appreciated in parts of Eastern Europe, some parts of the world, but also just not being alive anymore. He's losing influence. And, you know, another key Friedmanite idea was simply for central banks, the money supply really matters. That has not lost influence. I think some of his more concrete recommendations turned out to be wrong. But that basic point he drove home. And again, the world has basically admitted he's right.

How would you rate him as a microeconomist?

Oh, and you know, I spent time with Friedman a few times, and other people I know just said if he was in a seminar, I mean, if you made a mistake, you were dead meat. He would just be out with it and catch the mistake. I don't think he was actually very polite. But he would just call you on it and you couldn't really beat him in a debate. He was just too sharp and too quick. So as a microeconomist, he's A+.

Dave, did you have your hand up or no?

Sorry, I did. That was an accident. And I'm not related to Milton Friedman, by the way.

All good. So Tyler, early in your evaluation of Friedman, you bring up his 1955 memo on India. And it's not a piece that's often referenced. So why did you pick it to evaluate Friedman?

Well, I try to do this for every GOAT candidate. It turns out that except for Hayek, they all worked on India. I find this quite interesting. Every single one of them, often closely. We can get to that. So it's a test of an economist because none were experts on India. If you throw them into a new environment where they don't really have the background, how well can they make some sense of it? And I think on that score, I criticized Friedman on some points, but he did reasonably well. And he said India is not hopeless. This is a country that with some changes someday can grow at a rapid pace. And he was completely correct. And he understood the main problem in India is human capital and education. I think he was correct about that. So for someone who just showed up in India, uh, he did pretty well.

Of all the GOAT contenders, who do you think was the most insightful, um, on, on, on India if they wrote about it?

Well, again, all of them did, but Hayek. I think John Stuart Mill on India was misguided. So Mill thought British colonialism was good because it would civilize India. I understand why he felt that way, but he had never been to India, and I don't think he looked critically enough at how British colonialism often was run, usually was run, that you would do it through intermediaries. The intermediaries would be brutal.. And the colonial power would not invest very much in education or other public goods. They were just trying to hang on. And Mill worked for the East India Company most of his life, uh, filing memos. Malthus taught at the East India Company College much of his life. And they both believed in what the company was doing. And I think ultimately they were both quite wrong. They thought that the company was the path toward India doing better. Friedman never made that mistake. If you look at growth rates, India in fact did better once the British left.

So on Mill, it seems that his writing on India was short-sighted in a way that a lot of his other writing wasn't. But how much do you think that's a product of the fact that he, he worked for the Company and that his livelihood might have depended on it?

I view Mill as very intellectually honest. So he did many things on birth control, rights of women, universal suffrage that he suffered for, and he was kicked out of Parliament because they weren't popular positions. I think Mill's problem was he hadn't traveled enough, and I believe if Mill had been to India and witnessed what colonial rule was like, I think he would have had very different ideas. Now, that's speculation on my part. But Mill consistently in his career did not pursue, you know, what might have seemed to be the most self-interested course of action. He took a lot of heat for many things he said, and he was willing to do that. So I think he just didn't know. And if you're in Victorian England at that time, you're in what is by far the richest country to date ever. And it's hard to avoid the sense that, well, you're going to spread that to the rest of the world. It was a very common idea.

And you say that Mill is perhaps the most underrated of the GOAT contenders. He's— you consider him the deepest and most comprehensive thinker of all economists. So why do you think he's been largely overlooked by the discipline? Again, I think people tend to think of him as a social theorist.

I think Mill's reputational problem is no one, so to speak, owns him. So he was very pro-free speech, so the current progressive left is suspicious. He did defend the British in India. That's considered a mark against him. Uh, the right wing thinks of him as a socialist, which is really not true at all. Hayek wrote against Mill. Uh, Mill had a great concern with the welfare of the workers in his time. So he's not a standard left-right thinker. He's pretty orphaned. I view that as a plus. Uh, his best book, in my opinion, is Subjection of Women, which is somehow not radical enough for a lot of current feminists, but it's way too feminist for a lot of current conservatives. Uh, for me, all that's to his credit, but again, he's orphaned.

So let's talk about The Subjection of Women. You've noted that it's a foundational piece of economic literature. Why is it so important to economic history? And what can a modern reader gain from reading it, given that you've said that it's not radical enough for many people?

Well, in the context of this book, it's striking to me that of all these top economists, only one saw fit to write about what is 51% of the human race and has been a major issue always. Whatever your opinions on that issue might be, The mere fact that he tackled it for me is a huge plus. And the paradox Mill knew he had to explain is if women can be the equals of men, why is it that in the worlds we have observed they are so frequently subservient? Like, does not— does that not reflect some kind of natural order? So Mill gives us a whole lesson, set of lessons, and how you should draw inference from historical evidence.. And at the end of it gives you a very optimistic perspective that the evidence you see, if you think about it correctly enough, shows just how much opportunity there will be in the future for women. And men will benefit from this too. So he talks, for instance, about the one job that women could hold in his day. You could be queen, right? Queen Victoria. And he said the queens who are chosen more or less exogenously by like weirdnesses of sequence of birth Queens did as good a job as the kings, and that to Mill was a sign that basically women could do all the other jobs, maybe not professional wrestler against men, but all the other jobs if they were just given the chance. So he tried to reason his contemporaries into this optimistic, pro-opportunity, pro-egalitarian point of view, and I think what he says in the book is right. But unlike some current feminists, he says there are some intrinsic differences between men and women. And on that, I think he's right too. That's why some of the hardcore feminists don't like Mill.

Anna?

Yeah, sorry, there's Anthony. Sorry, Anthony, can you mute yourself? Or Alekha, can you mute Anthony? Thank you. Just, you keep popping into the recording. If an alien visited Tyler Cowen and you could only give one goat, would that be Mill or Adam Smith? You can only— there's no, like, there's no small print. It has to be one book.

Mill is my subjective choice because I like to surprise people. But again, there's always an argument for just picking the first person. But to me, it seems weird to pick the person who's actually the worst economist in the group. Because all these successors learned what was in Smith. So they have to be better than he is in that regard. So I'm going to pick Mill.

So let's, let's talk a bit more about some of the other GOAT contenders. So we've also got Hayek on the list, and you say that he perhaps has the 3 best articles of all time. Can you tell us a bit about what's so exceptional about each?

These are online, by the way, if you want to read them. But the first and most seminal is from 1945. It's called The Use of Knowledge in Society, and Hayek outlines how the price system is a decentralized means of coordinating economic activity and encouraging innovation. And we might now take this for granted, but it's arguably the most important insight of all of economics. Hayek totally nailed it. And it also helps explain why central planning has repeatedly failed. Just a beautifully written piece. It's completely correct. And Hayek was the one who did it. So that's worth a lot. Some people I know, they make Hayek their goat just for that. For me, it's not enough, but it's a major, major achievement. And it's not all Hayek has by any means.

You note also, however, that there are some small shortcomings in to some degree in his views on decentralized knowledge. For example, he was short-sighted about simulated competition. Can you talk a bit more about that? And how did that affect your evaluation of Hayek's goat?

Well, it knocks him down a little. So when you read Hayek, you tend to think the major problem behind central planning is knowledge and how to mobilize knowledge. And there's a lot to that. But another perspective is that the main problem behind central planning is one of incentives, that the planners and people who are running the stores on the ground, they don't really have the incentives to do the right things. They tend to keep prices too low, create shortages, and then sell off goods on the black or gray market for their own self-interest. And that maybe that's the more relevant problem, and that if you had a society such as Singapore, where the rulers to some extent take the welfare of the citizens into account, considerable extent. There's some cases where they've simulated competition and made it work reasonably well. So Hayek didn't understand that. It's not a major ding. He was so far ahead of the understanding that had come before him. But still, all these people have flaws. Which I try to point out, and that was one of Hayek's flaws.

You also note that while everyone agrees about Hayek's contributions to economics, um, there's not so much agreement on how these can be extended to other fields like politics, social sciences, history of ideas, and so on. How important is it for an economist's ideas to have wide-ranging influence?

Well, most economic ideas don't. They study one thing, they give you an answer. Oh, if you tax alcohol this much, how much people drink will go down by that much. And that's the end of it. Uh, but again, for people who, who thought broadly and deeply as Hayek did, he wrote a number of long books on politics and law. I would just say they're of highly variable quality. They're definitely worth reading. The best parts are amazingly good, but he wrote in a very Germanic fashion. A lot of it is unclear or cluttered. Uh, they're very far from perfect, and I think a lot of the central arguments don't quite hold up. So those also count against Hayek as GOAT, even though the books are excellent and worth reading.

Oh, Sean, you have your hand up.

Sure, make sure I'm not muted. All of the choices you had came, and I think there's some self-selection there, but came well before the information age. My question would be, what, who, who in the group would have changed the most in the world we're in today? How, how, like, said differently, which one of them is embedding a book in GPT-4? It's a very good question. Milton Friedman, of course, lived a little bit into the age of tech. You know, he used email. I don't think it really mattered for what he did. I'm not sure any of them would have. I guess Keynes is the most likely since he had interest in the arts. He was always reinventing himself. He was very connected to real-world events. More than the others, or maybe not more than Mill, but, you know, toward the upper end of that curve. So I suppose I'll say Keynes. Keynes was a modernist in the literal sense of that term, as you know, the aesthetic movement modernism. And I think that would have made him experiment with what's happening now. Yeah, it's an interesting thing because it's hard to every era has its medium of creation and it's hard to unpack its impact on the creators at a time like pre-printing press. You talked when I think I was listening to a podcast, talked about that if you're writing by candlelight with, you know, quill and pen versus typing on word processor versus using GPT, like how it shifts thought and actually makes some of the things more miraculous that they built what they did when they did. With what they had. You know, Smith was a major innovator in the following sense, that before Smith, almost all economics was in the form of short pamphlets. And Smith writes Wealth of Nations. I don't remember how many pages it would have been in the first edition, but it's a very thick book, right? And just the notion that you can write a thick book about economics, that was a revelation. And Smith pulled it off. So in media, Smith, in fact, is the greatest innovator in this group. And if you had just said to David Hume, "Oh, David, I'm going to write, you know, an 800-page book on economics," I suspect David supported that, but most other people would have laughed, like, "Adam, you can't do that. That's crazy. People are writing these 40-page pamphlets. You don't have 800 pages to say." But of course, Smith was doing the right thing. So maybe it's him then, and he's the first market mover. It's possible. He was the one who did the experiment in his day.

So on the topic of experimentation, innovation, and learning, um, Tyler, you do mention that one of, um, Hayek's weaknesses perhaps was that he built these intellectual boxes and wasn't necessarily able to climb out of them, and then he, he declined. Um, how did the other contenders fare in that regard? Did they learn over time? Did their views change a lot? How do you view their legacies in that regard?

Well, Smith just has two major books, and they're written quite a few years apart, and they're different, but they're not contradictory. But we have very little data on how he's changing. Keynes changed all the time. So he changed his mind on many issues every year or every few years. So he's the opposite of Hayek. He didn't have a lot of stability. And he always felt, well, world conditions will change, but I can come back to this issue and talk the elites who need to know into the right point of view. That's a little dangerous. But he was very hard to pin down. He would be the other extreme. Hayek, in a sense, had one insight. It's probably the most important insight, but he let it box him in. And he was denied other paths where he might have learned other things. So Malthus is actually much more varied than people realize. He wrote in many areas that he's not known for, and he was quite interesting or good in those areas. So he's more varied, whereas the word Malthusian implies this one scenario of doom where everyone starves because there's too many people and not enough food.

So let's talk about Malthus. What are some aspects of his work that people should pay more attention to?

I read Malthus as saying the fundamental problem of humanity and economy is simply virtue and vice, that people are not virtuous enough to make the world work. Now, whether or not you agree, if he's right, that's a pretty fundamental point., and none of these other people are saying it. So for Malthus, he understood you might produce enough food to feed people, and he understood that birth control would be more popular. He just thought the resulting society would essentially resemble that of a large London brothel. You know, think of a campus today, like all the, the sex that goes on. Malthus was a reverend. For him, this was horrible. Now, most people alive today don't think it's that horrible. You can debate that, but the mistake Malthus made was not about food, not about gloom and doom, but he thought that a society with so much sex would in some way be like the London brothels of his time, and I'm pretty sure they were horrible. Now, some of our social conservatives think what we've got is in fact too close to the London brothels of Malthus's time. Uh, but that was his point of view. So it's about how can you have a world with the sexual impulse where that impulse is manageable. He's really a precursor of Freud, and he didn't think that was possible, that human beings didn't have enough virtue. And those are just very interesting ideas, even if you're not on board, and Malthus's views are not mine, but that's the right way to read him.

So how did Malthus influence the discipline from there on? Um, Keynes, I think, cited him as an influence, but how should we view his legacy?

Well, Malthus, I think the third edition, if I recall, is 1803, right at the cusp of the Industrial Revolution. And all of a sudden, Britain starts becoming much richer. Many other countries follow. And it just seemed that Malthus wasn't relevant. Well, we're going to manage to feed everyone. And the fact that Malthus's real point was this thing about vice and what will the world actually be like once sex is freely available— people didn't want to talk about that. To some extent, it's Victorian England. You have Mill, who thought that freely available sex was in fact the way to liberate women. The much more modern view. And then by the time Freud comes along, Malthus is forgotten or connected to other ideas, and he's just stayed underrated for a very long time. I think Keynes understood Malthus quite well, and he very much admired him and knew it was more than just some kind of simple gloom and doom story. Keynes was a very, very good reader, among his other virtues. He's probably the best reader of anyone in this group. Milton was not a great reader. He would oversimplify anyone he read. It's like, oh, you must be saying this, and it would be a slightly simpler version of what the person said. Keynes found depth, greater depth than everyone he read.

So how does one become a good reader?

Well, to read Keynes's essays and biography, my favorite Keynes book, is an excellent way to start, or to read Mill's autobiography, or read Mill's two essays, Bentham and Coleridge, as a pair. Those are some of my favorite works in any area. But look, you have to read what it is you love, and you all have your own directions, and just keep on reading and rereading. You know, to paraphrase Hemingway, there is no one who knows how to read, there are only people who know how to reread. He said that about writing, as you may know. Everyone's first drafts are terrible.

Isabella.

Yeah, so my question goes directly to that. Who do you think is the best writer of them all? And so writer, I mean, I've just been rereading Darwin and he was just a fucking amazing writer, right? And so among these thinkers, Who would you say is the best writer and why?

You have some amazing writers in the group.

Mm-hmm.

Friedman is the clearest writer, but for me it's a little too clear. Keynes is the most beautiful stylist, but the general theory, a lot of that is poorly written. Uh, Mill is the deepest writer and conveys complexity the best, but I would say Keynes at his peak as an essayist, like in Essays in Biography, he would be the greatest writer in the group, if I had to say. Malthus has wonderful passages, but the clarity is pretty uneven, and there are reasons why he was misunderstood. It was partly his fault, and he wrote multiple editions of his main book, and the editions had actual substantive changes, and I think he tried to pretend a bit the changes were not there and that he was fully consistent. He would have done better to be more open about that. So that Malthus was misunderstood is partly his own fault.

So when you say that Friedman was perhaps a little too clear, what do you mean by that? And why is that a problem?

Well, if you read, for instance, Friedman on Keynes, Friedman is very reductionist. I view Keynes's general theory as not entirely clear, but there's 5 or 6 different arguments running through it. And Keynes, in a way, is saying if you keep all of these 5 or 6 different arguments in mind when you're confronted with a new policy crisis, you'll come up with something new that's useful. Now, that's a very complicated message to carry through. No book editor is going to tell you to do that, but there is complexity and a profundity to it, which Keynes understood. So Friedman reads Keynes and he just says, well, this doesn't seem to make any sense. For Keynes to be right, you need a liquidity trap to be in place. And there's not usually a liquidity trap, so Keynes is wrong. And it's just too dismissive, I think. He read Keynes too simply.

You've also said that Keynes is the most influential policy economist. He's definitely come back into the public consciousness since the financial crisis in 2008. So how do you think he made a comeback, and how do you think, um, his legacy holds up today?

Keynes's Chapter 12 has a beautiful and mostly correct analysis of speculative bubbles, which Friedman never thought were very important. He admitted sometimes they existed, but he didn't think they were central. And at least 2008, 2009, that swung a lot of opinion in the direction of Keynes. It's easy to see why. Uh, Malthus, Mill, and Smith also believed in speculative bubbles, maybe not as much as Keynes, but it played a big role in all of their thoughts. Hayek, no, he thought the bubbles were in essence usually the fault of the government, which sometimes they are, but not always. So Keynes maybe overstated speculative bubbles, but on that topic, of all the GOAT contenders, he's really the one to read, and that counts in his favor.

You've also said that Keynes is perhaps the GOAT contender you'd like to hang out with the most. If you could talk to him today, what would you ask him? What would you debate?

Well, I would want to know what he talked to Bertrand Russell about, what really happened at Bretton Woods, at Versailles. Uh, here's the thing with Keynes: when you read other people writing about him or talking about him, they all liked him, and these were demanding, difficult people. So Hayek was Keynes's rival. Hayek liked him and admired him. Bertrand Russell, not the easiest guy to get on with. Russell loved Keynes. All these great writers and artists wanted to hang around Keynes. Uh, so that's a sign I should want to hang around Keynes, right? The other people on the list don't inspire the same loyalty, other than like Smith and Hume, which was its own slightly weird thing. So Keynes was very popular with the finest minds of his time. He had by far the strongest interest in the arts, greatest breadth of experience, So that's who I want to hang out with, basically. Like I said, I knew Friedman. Friedman was great to talk economics with, but otherwise he wasn't actually fun. He was not in any way a bad person, but there's like the mono Friedman which you can consume and enjoy, and that's like the only channel. Keynes had many channels.

I keep thinking about these disciplinary boundaries in history. We're talking about people who wrote groundbreaking texts and came up with groundbreaking frameworks and, and, and, and ways to understand the world before the disciplines of economics or even psychology would be established. In some cases, it's really hard to even determine where they would belong. We could assume that probably Hume would have been a psychologist and would have been maybe like an Oliver Sacks kind of person. Adam Smith, you know, there are psychologist friends of mine who think that he was a psychologist, a social psychologist. And it's really interesting how through their work you can kind of reverse engineer how these disciplines started. And if you read them with the correct eye, you can see the thread that will eventually lead to, you know, PhDs and university departments. So I'm really curious if we posit that things constantly change and the field of economics will not forever change as it is because it wasn't always like this. Do you see trends in what people publish, maybe your students, your colleagues, yourself, from which we could predict what in 100 years the disciplines that will, that economics will evolve into will be like? Because I think that would, that would kind of respond or answer an earlier question about like what kind of books you want to read. And the importance of fandom, basically.

I would predict AI will be more important in economics, but in well less than a century. I don't feel I have any good prediction for a century out or even 50 years out. I would say in the last 10 years there's been a big switch. There was a 20-year period where people thought, due to behavioral economics, they thought economics will become much more like psychology. But that's done a huge U-turn. Because those results have not replicated very well. And behavioral is very much out of fashion. Maybe even there's been an overreaction against it, but it doesn't have influence now. If anything, people are just attacking it and rejecting it. So that's the very last thing to have happened, is moving away from psychology. I'm not sure if that would be permanent or not, though.

It's really interesting, though, and, you know, there are there's plenty of written on the more central importance of data in the social sciences, and it's less poetic. It's less speculative, less philosophical. I mean, there were a couple of instances even on your podcast where you would have a social scientist-ish person and you would try to have a maybe fact-based conversation with them. And they are sometimes resistant to that. If they were, on the other hand, interested in writing a book on how the world works and what theoretical frameworks to approach it with, would you allow them to sacrifice on the data-driven ideals?

Well, I'm going to ask them about data no matter what. For most guests, I don't mean if it's a novelist, but— and we're just going to see how they do, right? So this is often the vice of philosophers. They'll have all kinds of interesting hypotheses, often about human psychology, and many of them may be right. But if you ask them, what's the evidence for that? Typically they don't know whether it supports them or not. Or if you say, well, maybe there's no study of this now, but what would a test of this look like? And their answers to that question, I would say, on average, are pretty weak if you're talking to philosophers. Now, if you ask economists about philosophy, their answers to that are weak, to be fair. But Keynes and Smith were first-rate philosophers by the standards of their time. Friedman on philosophy was pretty weak.

So you've noted that you think AI will have a big influence in shaping economics as a field. How do you think that will happen?

I think we will start with small economies. You know, take a village of 50 Native Americans up in Alaska, and we'll just gather all the data we have from that village. We'll start with numbers, but then we'll go around and we'll talk to each person about what they do, their living, their income, what they buy., and we'll take all that and feed it into some supersized meta-large language model, and we'll have a model of that economy. Now, how large we can make those models, I'm not sure, but we'll start very small and it will progress, and it will be a fundamentally different way of doing economics. Not sure how well it will work. At first it will be attacked, but we won't be able to resist. We'll do it. I do think we'll learn some things from that.

I just asked ChatGPT what Tyler Cowen thinks, um, the field of economics will change in the next 50 years because of AI. It's, it's very long, so I will share it when he or she or it is ready.

Oh, Dominik. Oh, sorry, is that a question for Anna?

Yeah, but rhetorical question.

I'm with me.

Yes, sorry, I didn't hear it.

Oh, is it correct?

It gives you a lot of new ideas, I would say. You will like it. I will copy it in the chat. Yeah, you think that data analysis and econometrics will change your behavioral economics, as you said, market design and mechanism design. Okay, policy simulation and testing, understanding complex system, personalized economics, new theoretical models, automation and labor economics, global economic dynamics, ethical and societal implications. Yeah, I would say the oracle has spoken, but AI has its own incentive, so it wants you to like it, you know, so we take it with a pinch of salt.

Um, Daralek?

Yes, I was just thinking about that idea that you raised about AI enabling us to create a model of an entire economy. I'm wondering what your thoughts are on how we can, if this becomes popular, resist the temptation to use it primarily for central planning. Well, I'm afraid we will try to do it for that, but it may be able to plan, you know, more limited or simpler or smaller systems. So I don't want that research to stop. You could use it for a company, feed in all the company emails, some of the company discussions, tapes of the board meetings, whatever you have, and just ask it for advice. I think it will do very well. Even current LLMs, much less the next improved generation.

So perhaps a sharp turn, but we haven't— oh, before I make a sharp turn, Isabella.

Oh, I don't—

it's okay, you can sharp turn it, I can adjust.

No, no, no, go ahead. I was just going to go back to Adam Smith because we haven't talked about him as much.

Okay, I guess what I'm really fascinated by in these— this AI conversation, but also this book experiment with AI, and they interact is that as soon as you get the, whatever, intelligent layperson playing with these economic models, so it's not just the experts who are able to build a model, they quite, quite easily can get anyone who would like to do that. Then you have manipulation of agents, human agents that can experiment with those models and put their own input into, as in real-world input into changing or shifting those systems. I imagine In the same way that I think when you interact with your book and wonder what AI will say about Adam Smith versus Keynes, etc., there, there's something about interacting the way that you ask it the questions that you can start shifting the answers. And that interactive, the human-computer interactivity is what I'm fascinated by and why I don't think we can predict almost at all, because there is something that emerges from that learning experience. And I'm one, this is a very long way to say, I'm wondering whether you have had reactions to people who have played with ChatGPT and the book that were surprising to them and that felt like there was some emergent knowledge that even you had not considered or thought through when you put it out there?

Well, one thing that has struck me, you know, I don't directly see anyone's queries, but many people write me, tweet. How few people ask about the GOAT candidates and how many people ask about me. That's strange in a way. They could just ask me about me is one thing, but Keynes and Smith are like better and smarter and more important than I am, but people use the embedded AI to ask about me. So that's been my major takeaway from this experience. People will ask questions like, well, if Keynes and Hayek were sitting on a park bench, and Tyler walked by, what joke would he want to tell them? Things like that.

That is really funny.

I think it is because people aren't used to having— I mean, they know that you're out there and supposedly the most unpredictable there still living and so on. And I just find it really interesting because as soon as people start interacting with these things as self-organizing agents, I think there does shift a little bit, you know, people using it for therapy or people using it in different ways. And so I'm also very curious how it's going to change over time. In 6 months or a year of people continuing to read it in different contexts, like schools, for example. I'm in the education context, and I'd be fascinated to watch kids use it over months, for example.

I think a lot more education will be driven by LLMs as a semi-universal tutor. And this book, I will upgrade the software as it improves. We already have some improvements in the works, There's going to be an audiobook created. And who do you think is going to read the audiobook? Well, AI trained on my voice, of course. We'll see exactly how good a job it does. But, you know, I'm going to keep on going and write more too. But this thing will itself evolve. It's possible the next GOAT is simply AI. It'll be like GPT-7. Because as I think you all know, GPT-4 has been trained on a lot of programming. It's not trained on economic models, as far as I know, not in any systematic way. And if you built a GPT just to be a good economist, uh, I don't know if you could do it now, but I think in less than 5 years you could build the world's greatest economist.

What training data would you put in?

Well, all published articles on economics, including the math. Right now, it doesn't really handle the math at all. So that would be a big difference. You would need— we call it now a plugin. I don't think it'll be done through plugins, but you will need an integrated self-learning system, quantitative system like Mathematica, and large language model, but as one integrated thing. I don't think that will be difficult in the near future, but we definitely don't have it now. And then you'll just shove down its throat everything we've got and train it for a while. We'll see, but I think it will be remarkably good.

Dave?

Yeah, regarding large language models, and I realize it's a little far afield from the Goat Economist, but I just am curious. What are the— what do you see as the economic effect from more advanced AI? You know, I hear a lot of skepticism from certain investors about AI generally. And on the other hand, a lot of excitement from economists, entrepreneurs, and other parties. And I just am sort of curious where you fall on that line? I don't think it will kill us all. I don't think GDP is going to grow 40% in one month, but I think it will boost productivity, make intelligence less scarce, greatly disrupt the world, overturn most status relations, and mostly be unpredictable, but on net be a good thing, a bit like the printing press has been. That the printing press also was in fact dangerous. That makes a lot of sense.

Anna, uh, can you say more about the overturned status relations? Because like images of the French Revolution popped up in my mind suddenly.

Sure, you probably know Robert Darnton has a series of books arguing the French Revolution was driven by the birth of a new kind of information society. This is now a pretty well-accepted view, although that's not the only factor.

It was the first university revolution, right? Because they were all classmates.

People now who can write very well, they tend to have high status and they're very influential. A lot of that's going to go away. So, odds are it will redistribute income toward highly intelligent carpenters and gardeners and away from what Marc Andreessen calls the word cells. That's some of us, to be clear. I'm already planning my own future around this. I'm going to give a lot more talks. This is one of them. And I don't know about write less, but I will rely less on writing as a source of income. It'd be more a way of, like, generating ideas for talks and physical presence. So the AI still cannot compete with me for some kind of, you know, room charisma, we— you could call it. So I'm going to do more of that. I think you all need to be ready in some way, figure something out. It's going to change everything. So I don't like the term AGI. I think it's misleading. I don't think any intelligence is general, including human intelligence. But something like what people call AGI in its less dramatic form, I think, will be here within 2 to 3 years. And that's an increasingly accepted view amongst people who work on this. And I don't think it's a partisan view. A lot of people who were agnostic a year ago have come around to thinking this. So, I mean, inter-intellectual change too. It'll be very interesting. As Elon Musk said in his Andrew Ross Sorkin interview, we are privileged to live in the very most interesting of times ever. And we are. So be scared also.

And ready for the most entertaining outcome. I mean, you have, you know, the foresight to plan your future in carpentry and talk giving. I will learn how to knit. That's not a problem, but like status struggles and status quo upheavals are usually violent in our history. Do you think that AI, the presence of AI in our lives might make us more peaceable? Will it be a different kind of, you know, information sharing or institutional revolution than what surrounded the French, you know, Austrian, Russian revolutions, the American Revolution?

I don't expect a repeat of any of those. Again, I don't have a clear prediction, but we're much older. We're all— we're mostly cowards in a good way. Like, we hate violence. We're not used to seeing people die. We're older. Society is much more feminized. So I'm not per se predicting violent conflict. I mean, we already have it in some parts of the world. So I'm not saying there'll be no parts of the world with more violent conflict.. But in the richer societies, it's not my central prediction. Most people are scared of violence and hate it for mostly good reasons, and I think that's going to stick.

Thank you. We actually had a Kevin Kelly Super Salon a couple of weeks ago, and when he asked for our most heretical ideas, I shared my view that laziness is the best human quality. And maybe if we have a tool that actually increases human laziness in a good way, then we can We can be assured that it's, that that's where the tilt goes.

And you can expect to live another 5 or 10 years with advances, many of which will be due to AI. So that also will make people more risk-averse. Whereas in older times, if you thought, well, I might die at age 37 anyway, they're asking me to, you know, take my musket and go to this revolution. Yeah, you know, why not?

So I wanted to also wrap up the conversation on the great economists, the contenders, those, those who didn't make the shortlist. I don't think we've talked enough about Adam Smith, even though he was one of the— he is recognized as the father of economics. He was the first to synthesize economic history and fundamental concepts into a a coherent book that not many people have actually, actually read, The Wealth of Nations, because it's so long. When you recommend Smith's work, Tyler, you mentioned his analysis of national defense and education. So why do you think those remain relevant for the, for the modern reader? Like, what can we stand to gain from these texts?

Smith is most famous for defending capitalism, the invisible hand, a number of other points. That's all you know, as it should be. But when you read deep into the book, Smith ends up saying defense is more important than opulence. And I think in a world that is increasingly at war, this looks pretty wise, that one reason you want to be rich is to defend yourself. But if you can't defend yourself, it's not so useful being rich. And some things in policy— Smith advocated for a kind of industrial policy so Britain would be number one in shipping. For a long time, people thought that was some residue of stupid mercantilism, but in a world where America is doing the same with, say, semiconductor chips, it doesn't sound so stupid. Again, you may or may not agree with Smith or with current policy, but there are clearly reasons why countries do these things, and Smith was on to that from the beginning. And I think the last 10 years makes Smith look look a lot wiser. For Smith, national defense and education are cornerstones of your society, and if you're messing those up, the rest is not going to matter. And the world has come around to that, but people don't know that was central message of Adam Smith. They're still thinking capitalism, invisible hand, all that. Both are true, but, uh, Smith has gone way up in my eyes.

So Smith has gone up as a result of what's happened in the last, last 10 years in your eyes. So it seems that economists can become more or less relevant over time. Do you think that there are other economists in your shortlist or people you didn't consider a GOAT contender who could have great influence in the future? Or do you think that your shortlist has lasting relevance?

Well, I like my shortlist kind of by definition. I would just say Malthus could see a major upgrade. So as you all know, Malthus was obsessed with environmental problems. Those have become increasingly important. If they're ever on the verge of ending the world, you know, maybe we need to recrown GOAT and make it Malthus. That's not my prediction or expectation. But I wouldn't say it's impossible. So Malthus is the dark horse at the back of the pack, but he could in a terrible, tragic way make this late spurt and end up winning the whole thing.

So continuing on with some of the economists that didn't make it to your shortlist, for example, you talk about Samuelson, and one thing you note there is that maybe ideological dogmatism to some extent drives truth and science forward. Can you unpack that?

I view Samuelson as pretty dogmatic. People I've talked to who knew him— I never knew him— agree with that. Samuelson thought Soviet economic growth was going just fine and they would catch up to the US. That clearly was wrong, but it also shows there was a bunch of things he didn't understand very well. But his best pieces are brilliant. He had many contributions. He could have won like 5 Nobel Prizes if it were done that way. So he's a major figure, in part driven by his own stubbornness and dogmatism, wanting to push back against certain things. So in the progress of science, you know, virtue is not always our friend. Related to what Anna said a moment ago, virtue can be the handmaiden of laziness. And science does not flourish through laziness.

So, another economist who didn't make your shortlist was Kenneth Arrow, and he's most widely perhaps remembered for moral hazard. So how has our understanding of that evolved, and why do you think, again, like Arrow has lost ground?

I don't think Arrow has lost ground. I think he's actually in some ways gained ground. Of all the ones who didn't make the shortlist, he for me is the strongest contender. I think one of Arrow's problems for being GOAT is he spent a lot of his life on mathematical general equilibrium theory, and that's just not the direction things have gone in. But he was one of the very deepest thinkers. He had a great deal of breadth. Theory of moral hazard comes from Arrow. Our theories of how to price different securities— equity, debt— comes also from Arrow. Those are pretty important contributions. I think over time I see moral hazard problems as less important. So the typical moral hazard claim would be something like, if you give people too much health insurance, they won't take good care of themselves because someone else is paying the bill. I just don't see that in the data. What I see in the data is the people with a lot of insurance are highly conscientious and they take pretty good care of themselves. And the people who drink too much or overeat or whatever are the people who also don't buy health insurance. So I would upgrade mechanisms of selection in my understanding of the world and downgrade the relevance of moral hazard. But Arrow is still like way, way high well into the top 10. His strengths are very, very strong. If you're going to put any extra person on the very short list, it would be Kenneth Arrow.

Dominic?

Yeah, I'd just like to ask a quick follow-up question about the moral hazard issue to see how you would adapt your argument on moral hazard to a society like the UK where healthcare is provided by the government to everyone regardless of your choices. There is some major public health problem in the UK that has to do with how people behave, how they eat, how much they drink. I don't understand it very well, but I do see other societies such as Sweden and Denmark where there's also the equivalent of free healthcare, not totally free, but broadly free, and people take much better care of themselves. So I would doubt if that is the reason why, you know, Scotland and North England in particular have such severe public health problems at the behavioral level. But I don't know what the reason is. It's interesting to me when you see Scots-Irish migrants to the US, they replicate those same behavioral public health problems, say, in West Virginia, as are seen in Northern England. I don't know why that is. It strikes me as a major puzzle. That we should be working harder on.

Now, all of your GOAT contenders are— none of them are contemporary, and you've talked about why you don't think that we can have another GOAT contender again. So I'm curious to hear you expand on that a little. And I'm also curious if you wished your GOAT contenders had written about any problems or issues of their times that they didn't touch on?

Well, I would have liked to have read Hayek on India, just as a comparison point. I would have liked to have read the others beside Mill on gender, economics of gender, rights of women. I genuinely don't know what they thought. Uh, probably they, you know, would be considered reactionary to some extent, but you don't know. Smith was radical in many ways, very anti-slavery. Keynes was friends with a number of women who, you know, seemed to have been lesbian or quite feminist, maybe not using that word. What did Keynes really think? I think I've read just about all of Keynes. I feel I don't know. So that's what I would have wished for. What was the first part of the question again?

Um, the first part is just that there aren't any contemporary economists on the list. Like, Friedman is the most recent.

Yeah, they're not broad enough. And, uh, a lot of the low-hanging fruit is picked, and they're doing things at the margin. They're very smart, they work very hard, very praiseworthy, but in some ways a little dull.

So is there an economist who are, or thinker in this field who didn't make your shortlist, perhaps because they exited the field or passed away too early and you wish more people would read them?

Well, Frank Ramsey, who was a friend of Keynes, by the way, he was a mathematician, but he did some economics and it was absolutely brilliant. If he had lived, it's a very good chance he would have done more economics. I wouldn't say I would think he would be GOAT, but he could have ended up in the top 10. So that's one of the great tragedies is Frank Ramsey.

How do you think all of your GOAT contenders influenced each other? Or, I mean, there were some famous rivalries, like, for example, Keynes and Hayek come to mind. Or do you think they're all like many of them are fairly in different— thought about fairly different parts of economics, and that's why they made part of your shortlist.

They were obsessed with each other for the most part. It's really striking how much the GOATs are all writing to each other in some way, responding to problems the other posed, obsessed with the status of the other with respect to themselves. In pretty much every case, like almost every relationship. I don't know that Friedman was obsessed with Malthus. I think he didn't read him carefully enough. But other than that, it's a single story. And that's one of the things I really learned writing this book is how much it is a single story and not disparate thinkers.

Speaking— now that you bring up Malthus, one of the things is Malthus had this great correspondence with Ricardo and that helped push economic thought forward. Can you tell us a bit more about that? Is it something that the modern reader would find interesting too, parts of their dialogue?

That's a great correspondence. Much of it, maybe all of it, is online as well. And, you know, if you go to these rationality community blogs like LessWrong, and they work on different ways you can argue better or be a better truth seeker. Maybe the very best version of that in the history of ideas ever is Malthus and Ricardo writing back to each other, and they disagree fundamentally, but they're trying to find a common truth. And in those letters you see so much epistemic virtue, and I don't think it's fake. You know, they do give ground at different points when events show one or the other, who have been right about something. But those are just models of clarity and beauty and friendship and truth-seeking. And someone should just do a book of those letters and market it as some kind of epistemic virtue and rationality. I got a big kick out of rereading them.

So your interest in economics and economists began early. Um, how did you get hooked on the discipline?

I went to the Rivervale Public Library in northern New Jersey and took out all the books I could. This is starting at age 13, but really picking up at age 14. So even Smith, Hayek, I had read at age 14. Malthus, Keynes, the others, you know, would have read at age 15 or 16. And there was so much in it I didn't understand, just like now. But I learned economics through these people, like before I did grad school or even undergraduate. So to me, they've always been very alive. I think I find it relatively easy to think as they did because that's my initial training. And that's extremely rare nowadays. Like, first people go to school, they're taught, and then maybe later on they get interested in these books. But for me, it was the opposite. So I'm very much a throwback.. And I thought that was another reason why I should write this book, to give people the perspective on these writers of someone who learned from them first. And that's disappearing, disappeared, I'd say.

Isabella. Just following on that, I wonder if you can— so the one that I know the best is Keynes because I was obsessed with Bloomsbury. I still am obsessed with the Bloomsbury Group. And I often wonder whether— well, I know for sure the social context of all of these thinkers had to have made an influence on them. And can you— so can you comment a little bit about— not— I don't mean the time, the cultural context, so much as who they're surrounded by and whether you think the extent to which their thinking and how they wrote and why they wrote had was influenced by the near, the senius or the kind of context that they were in day to day?

Well, Keynes, so often he's writing for liberal politicians in Britain and he had real influence. So he took very seriously what he would write. But I think he had this personal mission. He thought there was some sense of the best way of life. And for him, it was a lot of time talking ideas with close friends. A lot of time spent with the arts, some involvement in the real world, and some huge dose of sex, often casual sex. Whether or not one agrees, that was Keynes's vision, and he had a personal mission to keep the world safe for that. So when the Nazis come, I mean, of course he's on the side of Britain for a bunch of obvious reasons, but I think he's also taking it quite personally. He's wanting to carve out and protect the world he knew where that kind of life was possible, and he knew it was under threat. And he rises to the occasion. He helps a great deal with the war effort, postwar reconstruction. That's in a way his most productive and important period. And he was very personally directly motivated, I believe. Not just patriotic. Uh, selfish isn't the right word, but it was part of his ideology that this This was important stuff and it had to remain as a human possibility for the whole future. And it has.

Lawrence.

The first economist is like, is 250 years old now. Why do you think it took so long for people to start thinking seriously about this? Like Aristotle wrote about everything. As far as I know, he didn't think about like, how are prices set? You know, who determines prices and all these things? Like, why, why didn't even people think about this as a thing you could think about? It's a very good question. I have a whole paper on only that question. It's not finished, but I have about 30, 35 pages. You know, Euclid is quite early and it's brilliant and it's not easy. Newton and Leibniz with calculus, not easy. You look at 17th century economics, it's pretty piss poor. I mean, it's barely anything. So the 17th century Salamancans have some basic pieces. The early mercantilists have some basic pieces, but it's still fairly primitive. There's something about economics that is more counterintuitive than we moderns realize. I think that's my conclusion. But I still find this a big puzzle. That's partly why the paper isn't finished. I don't quite know how to finish it. I've done enough research. I just haven't figured it out enough yet. When you say Count Dracula, right, maybe the best writer, and he's at the cusp of, you know, 16th, 17th century, very early, or Spencer, Fairy Queen, you know, a bit earlier yet. And they had no trouble being brilliant back then. But the economists of their time are nothing.

Why do you think it's counterintuitive? Is it partly a function of how complex economic systems are, the fact that you can't separate them from other disciplines and thoughts and forces that are very difficult to measure?

I don't know, because it's the simple points people hadn't really grasped. That's what I don't understand. So if they didn't have a complex model of all the interrelations, which we still don't, of course, okay, I could see that. But even just simple supply and demand, which you can teach a high school sophomore usually with no problem, and they will get it if they study, it's not that hard. And they didn't have that. Uh, it's a big puzzle for me. I think somehow you don't You don't see it as important without observing some other larger picture.

So why do you think Smith was able to start crafting that larger picture?

He had read all the mercantilist economics of his time, and if you would take the best from those pamphlets, you do get two-thirds of Smith. So he was an incredible synthesizer. He was just very studious, and he was a great judge of what's a good argument. And then his best friend was David Hume, who was the smartest man in the world. Smarter than Smith, I think. Not his equivalent as an economist, but just brilliant. So if you have the smartest man in the world as your friend, and you're a great synthesizer, and you work 20 years on a book, and you're an introvert, and you like live with your mom, and don't go out and don't drink, don't whatever, you might come up with something. And he did. He was not a worldly guy. He loved conversation with other smart people. And when he spent time in London, he did spend his time with the other smartest people in London, you know, Burke and Boswell and all that. But mostly a loner and a reader. And he and Hume, I don't think they had an affair, But they were strangely close in a way where Smith did not have many other close ties. And Smith never married. Uh, there's something homoerotic in that that was highly productive, you know, like Benjamin Britten and Peter Pears, who did have an affair and they made it work. I'd love to know the full story there.

And I think you had your hand raised.

I'm just, I'm just stuck. I mean, I would love to hear more about the Hume-Smith homoerotic affair, but I'm also kind of stuck at the, um, at the incentive part of there not being an economics before, uh, before a certain period of time. And I'm thinking of Michael Nielsen's book Reinventing Discovery, where he kind of, which if I'm not mistaken, killed off his academic career because he was too right. Tyler Cowen, about how many scientists are simply just not incentivized to share their data and findings because it's a zero-sum game. And if you think back to courts or merchant houses, why would they publish their— why would they have published their economic knowledge? They must have had some of it because we hear about the major mess-ups and we know the horror stories of the famines, but we also know that some sovereigns had really good advice. It was just not, you know, available on SpringerLink or how it's called. And I wonder how, you know, with some countries descending into similar situations, whether we will, you know, reestablish knowledge blockers like that?

It's the desire to publish and influence policy that finally drives economics forward. And it could be in earlier times, I mean, you could write, but there was no real pamphlet culture before 17th century England. So there was no point in writing. And if you need to write things out to figure things out, which I would say is usually the case, no incentive to write things out. So there was no competitive rivalrous dialogue through which economic ideas could improve. And that may be part of the answer to this puzzle of why it took so long.

I mean, there's economics in the Bible.

Sorry?

There's economics in the Bible. Jacob serving Laban and like multiplying the goats. And then Laban is not rushing to Jerusalem like, guys, I have this super smart guy in the house and use the knowledge. He's like, no, no, it's It's our goats. It's actual goats.

Literal goats. Yeah. Not my goat. Their goat. The real goats. I'm going to have to go in a moment and give someone a ride. I would just thank all of you for coming and reading and asking. Look forward to seeing you all again. To thank my interlocutor for preparing so well and having so many good questions. To thank Anna for doing all of this. Happy holidays to you all. And let's wish for the best.

Thank you so much for joining us, Tyler, and thank you all for participating. This was a great conversation.

Thank you so much. Wonderful host, wonderful guest, as always.

See you soon. Bye. Bye.

Bye.

Love the holidays. Bye-bye.